Originally Posted by
Dairyground
I always assumed that the main rationale for fuel and other surcharges was to reduce the proportion of the total fare on which commission to travel agents was paid.
That is one reason - although the days of a standard 9% commission are long gone.
One hidden cost of pricing is the actual cost of distribution of fares into airline's own; other airlines; GDS ; and agency systems.
Most network airline distribute their fares through ATPCO (Airline Tariff Publishing Company) ATPCO is not-for-profit, owned by the airlines. They charge the airlines a fraction of a cent per fare record whenever the base fares are updated. They then distribute the updated records to the above.
Airlines literally have millions of fare records between every on-line city pair served, in three (or four) class of service, in multiple flavours (PEX; APEX; NONREF/REF/etc. So to adjust all of an airline's fares can cost $10s or $100s of thousands. The cost to update a surcharge is on the order of $100 (or so, it has been a while). Many airlines no longer call these 'fuel' surcharges - they are 'due-carrier' surcharges.
Discounts - such as child discounts (there are others) usually don't apply to the surcharges so by splitting them out they reduce the actual discount.
And some airlines apply the carrier imposed surcharges on frequent flyer tickets etc.
Now, I'm not defending any of these practices - I think some are actually immoral.
But this is why we still have 'surcharges' - which are rarely seen by anyone before ticket issuance. In Europe and N. America (plus many other jurisdictions) the airlines are required to show the consumer final price for transport, inclusive of these surcharges.